MC4F12-Brand Management - Level 4


For a business, in context of profitability and revenues, a credible brand is a key of success. A brand is a name symbol, design as well as intermixture of all of them that is conscious in order to identify goods and services of one marketer or group of Sellers and to separate them from market competition. Its a sum total of company's value as evidence by how it is deliver these value at every point of contact. Hence, branded products are able to raise customers' satisfaction level as it is very much important in marketing. It also assure better quality, easily availability of goods and pricing stability to target audiences. Branding supports a firm to accomplish its goals and objectives in a certain time period. L'oreal is the chosen organisation for this present assignment, its a French personal care company. It is a world's ample cosmetic company and formulated its actions in aura of skin care, perfume,  make up, sun protection, hair colour and hair-care. Apart from this, the report will be describe importance of branding in emerging business practices. Readers will also come to know about key components of successful brand strategy how to manage brand equity. At last, there will be discussion upon diverse techniques in order to evaluate and pull off br

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P1 Importance of branding as a marketing tool and how it has emerged with business practices

Brand - Before understanding the term branding, readers firstly have to know about the core concept of brand. A brand entails with a product or service which differentiate an organisation to its rivals ; creating an effective brand assists both consumer as well as manufacturer generates a win win situation for both parties. Along with this, brand provides legal protection towards novel aspects or features of goods. Brand loyalty will contribute to retain existing customers while diversifying one product line and it also renders security of demands and creates barriers for other manufacturer in order to easily tap existing customer.

Branding - The term branding can be outlined as a process of building an unique name, design, symbol, message or tag line among consumer’s mind with an aim of distinguishing it from external rivals offerings and increasing loyalty. Branding helps differentiate products and services of the organisation and make them worthy for customers. However, a brand represent a firm's message and objectives that go beyond selling a product. An effective branding is able to get customers' know about products' details and its usage; it also promotes recognition of business. Additionally, an attractive brand can make referrals or viral activity since individuals love to educate others concerning the brands they like.

Branding strategy of LO'real - L'Oreal is a popular cosmetic brand among people especially in women. The main brands of the firm are – Lancôme, Giorgio Armani, Yves Saint Laurent Beauté, Biotherm, Ralph Lauren, Shu Uemura, Cacharel etc. The overall revenue of L'Oreal is €26.024 billion and current operating income is €4.676 billion. There are overall 90000 employees are presently working with the company; it always focused on providing innovative and worthy products to target audiences for obtaining maximum competitive edge from target market. L’Oréal is one of the world’s top beauty brands as its total worth is $110 billion approximately. As the brand maintains its seat at the top through innovations in technology, beauty and advertising. For example- introduction of L'Oréal's own particular site uncovers magnificence tips, traps and items that can engage ladies to achieve their optimal level of excellence. Its articles have simple to take after well ordered instructional exercises joined by itemized pictures and recordings. Then again, L'Oréal made the first virtual make up analyzer application named Makeup Genius. The application empowers ladies to attempt different make-up looks progressively with the utilization of 300+ L'Oréal items. All these marking techniques causes firm to remain effective in showcase rivalry.

Importance of branding as a marketing tool and emerging business practices: - 

  • Branding influence recognition – The most important logo in brand it its logo as if people are aware about this, then it means branding has worked. Logo design of company must be simple and enough powerful to affect customers' choice. Thus, effective branding ensure that more and more get know about firm's offerings or products.
  • Branding builds trust – It generates trust and credibility of people; it results customers will get influence to purchase products and services. But to build individual's faith management requires to generate qualitative or value added products which are able to satisfy customers' needs and demands. A brand also communicates a culture of reliableness that customers share with a brand; most  importantly a brand builds trust of its audiences.
  • It provides employees' inspiration – A strong brand is able to attract people to work with it; they feel proud to engage with that brand as well as try to accomplish organisational goals and objectives.
  • Brands helps to launch new products – Strong products or brands sets a way for growth and development of a business association. When people started to trust upon a brand, it supports associations to add new product in their product line or even get into a different area.  L'Oreal may have begun off offering hair shading, yet because of awesome buyers' reaction and confide in the brand, they grabbed up LO'real make up items, healthy skin and antiperspirants when these new items were presented.

Differentiation between product and a brand: - 



A product is made by firms and purchased by a customer in exchange for money.

Whereas brands are created through   perceptions, expectations, and experiences of consumers by all offerings which are involved in a brand umbrella. 

A product can be copied by competitors at anytime.

Brands are unique and build by previous experience of customers who buy them.

Main products of L'Oreal are – make up Foundation,  Lashes Mascara, Infallible Mono Eyeshadow, Riche Nutri Shine Lipstick, Titanium Nail Paint etc.

Main brands of L'Oreal are – Lancôme, Giorgio Armani, Kiehl's, Biotherm, Yves Saint Laurent Beauté, Ralph Lauren, Cacharel etc.

P2 Key components of successful brand strategy and managing brand equity

Brand equity – It is a set of brand assets and liabilities associated to the brand. It adds or subtracts value of a products which are offered by a firm to its customers. Brand power means a its power that is derivable from market good will and its name or fame which is earned by the a company over time. In addition, it helps into maximum profitability and sales revenues in comparison with competing brands. In simple terms, brand equity is a set of subordinates that supprts a brand to pull in efficient volume then it would without brand name.

By considering L'Oreal, the firm manages its brand equity by making certain necessary modifications in its existing strategies so as; it supports to boost up market value of the company. Although, brand equity begins with unique style, thrilling messages as well as compelling picture which driven up brand value. L’Oréal Paris is the most valuable cosmetics brand for the third consecutive year; the brand has reached a record value of US $13.7 billion. L'Oreal is located in 130 nations by having 32 international brand and it has registered with 500 patents.

Below is defined several key components to manage brand equity: -

Public relations – It is essential for multinational business associations, like – L'Oreal to manage strong public relations by fulfilling its social responsibilities. In addition, companies have to make their products as per customers' demands or taste. For this purpose, there must be required to have provide positive working environment to manpower as they can work in different strategies to accomplish vision and mission of the company.

Digital marketing - Building and developing the image and reputation of a brand at the international level is essential to manage brand equity of various brands in the portfolio. In this sense, the cosmetic giant communicates over the globe by using digital marketing channels, such as- e-mail marketing, display advertising, content marketing, pay per click advertising etc. all these channels assist firm to arrive large group of customers in a certain time period.

Social media – Social media marketing entails with process of gaining traffic or attention through social sites, i.e. Facebook, Twitter, Instagram, Pinterest etc. Thus, it is a powerful way for businesses to arrive to reach target audiences and manage brand equity. In addition, social media often  feeds into discover of new content and it supports to build link that in turn support into SEO efforts.

Key elements of strong brand: -

Brand loyalty:- It is considered with repetitive purchasing behaviour of customers. If a customer loyal towards a particular brand then he or she will continuously buy  that specific product. Along with this, brand loyalty is one of the crucial indicator while measuring brand equity as it drives post purchases.

Brand awareness:- Awareness of a brand name between target audiences is a first step of build equity. Basically, brand awareness means customers' know about the product or not. Although, low level of consciousness  reduces sales and profitability. Thus, to improve brand awareness L'Oreal is focusing on making itself visible among target audience by various promotional methods such as publicity, sponsorships, events, advertising, instigating word-of-mouth promotion, etc.

Perceived quality – It is a perception of consumers' towards quality of goods and services. While evaluating quality, customers' taken into account performance of a brand in different parameters, and then make judgements about quality by valuing competitors' offerings. In addition, quality perceptions also affect pricing decisions as better quality products charges premium prices.

Brand association:- Anything which aids to link customers memory about a brand is an association. People creates associations based upon quality perceptions, interactions with staff members, advertisement of the brand, price points on which a brand or product is sold, product displays in retail shops, offerings of competitors etc.

Challenges are faced by firm to develop its brand image: -

Cultural differences – Each and every cultural has its own set of standards and customs in which people live. Thus, it is fundamental for marketers to recognise about the cultural of the nation or community in which it will serve. Sometime, due to cultural differences firms are not able to meet needs and wants of customers.  For example, westerns' believe that suntans are attractive, youthful, and healthy whereas the southern's  do not. These key differences apply to labels and branding as well.

Increases global consumerism – In this modern era, there is a rapid change in consumerism and demand of new products also arises. Along with this, consumers also  willing to know about brand as well as corporate transparency. They wish that firms get more socially, eco-friendly as well as accountable towards societies in which they are performing.  International brand, i.e. L'Oreal percive as monolithic by having very little or no social responsibilities. It affect brands image worldwide bad publicity and comment through global news networks and anti-corporate websites.

Financial challenges – Funding is one of the biggest challenge face by during branding which needs to be successful.  A strong finance is required to do marketing or branding activities at global context. Thus, a sensible budget needs to be formulated so as to branding because it is significant consideration to increase sales.


P3 Different strategies of portfolio management, brand hierarchy and brand equity management

L'Oreal is a largest group of cosmetic across the globe which is operating in 130 countries and it has brands in five major areas, i.e. salons, body shop, hairdressing, consumer and luxury products. The firm works on its famous slogan, i.e. Because I am worth it. The brand is known by all customers due to its effective brand recognition. In this sense, it is necessary for the company to maintain their brand equity by implementing innovative strategies which aims is to arrive more and more consumers.

Brand equity entails with additional value which attaches an individual with a particular brand which is novel from others available substitutes in market.  In simple terms, brand equity is a goodwill which a brand has gained over a time. Although, brand equity can be measured through evaluating a brand's earning potentials for long run.

Brand portfolio strategy of L'Oreal: -

Corporate brand – It seeks with connects the name of corporation while doing all advertisements efforts in customers' mind. Corporate branding can be successful if customer hear or see the name of the company.  Companies those have strong corporate brand name can easily advertise or promote themselves at sporting events, movies as well as on other products. In addition, that name will instantly put a positive impact on customers without having a list of product's features or latest innovations of the corporation.

Umbrella brand – It is also known as family branding, thus umbrella branding seeks with merchandising practices that encompasses with selling goods or services by using a particular brand name. In addition, concept of umbrella branding develops great brand equity for a brand or product.

Endorsed Sub brand – An endorse sub brand is an intermixture of single and well-defined product brand that are connected together under a endorsing parent brand. It plays an accessory and linking role in order to improve brand image of the company. An endorse sub brand can be succeed when it associated with family product which have shared high level outlooks that is valued by target audiences.

Product -  A product is an item which is offered by a firm to its target audiences, products can be in virtual or physical form. In addition, every product is made at a cost and sold at certain price.

Management hierarchy of L'Oreal: -

  • Umbrella brand - L’Oréal’s flotilla of brands is organised by Division, which each develop a specific vision of beauty by consumption universe and distribution channel. The main umbrella products of the company are – L'Oreal paris casting cream gloss, intense instant smoothing serum, hair expertise,make products, skin care, shampoo, condition, hair style etc.
  • Endorse sub brands -The Oscar-winning actress will represent the beauty brand in the UK, initially endorsing the Age Perfect anti aging range. Garnier, Maybelline, Nyx, Essie, Dark Lovely etc. are the sub brands of L'Oreal.
  • Products – The main products of L'Oreal are – casting crème gloss hair color, glam shine balmy gloss lip crayon, infallible eye shadows, pearl perfect night cream, minerals foundations, blendable foundation, color riche lipsticks, millions lashes mascara etc.

Management hierarchy of Lakme: -

  • Umbrella brand - Lakme is one of the oldest, well-known cosmetics brand offering the comprehensive range of make up and skincare products for women. The brand also provides beauty services through its Lakme Beauty Salons and Studios. The umbrella product list of the company are – Lakme Eyeconic kajal, curling mascara, complexion care cream. Lakme perfect radiance intense whitening compact, Lakme enrich satin lipstick range etc.
  • Endorse sub brand – In order to promote itself, Lakme endorse various actress or models. Recently, it is launched Baked Blush having four amazing shimmering shades.
  • Product –The main products of Lakme are - Lakme CC Cream, Lakme Absolute Illuminating Eye Shadow Palette, Lakme Absolute Kohl Ultimate, Eyeconic Mascara and Eyeliner, Weightless Mousse Foundation, Lakme Absolute Lip Pout etc.

Brand equity of L'Oreal: -

Brand equity matters, because positive brands are profitable brands. Everything a business does, and every interaction it makes with customers, represents a building block for that business’ brand. Over time, these actions build brand equity the significance and impact of the brand’s name. L'Oréal Group has turned into the biggest makeup and magnificence organization on the planet. In 2017, L'Oréal was the main individual care mark on the planet with a brand esteem that added up to 23.89 billion U.S. dollars. Between 2015 to 2018, the organization's compound yearly development rate expanded by 4.2 percent. L'Oréal Paris' shading corrective dispatches – including Miss Manga mascara and two-advance Infallible Nail Polish – impelled make-up to the main classification in the L'Oréal Consumer Products division.

CBBE model (Consumer Based Brand Equity)  -

The model of brand equity supports in better planning of marketing strategies which are linked with working activities and practices. Thus, to get better product portfolio management is necessary for building a strong brand value among customers. In this manner, formulating higher customers' experiences of a product by positive thoughts, beliefs, opinions and perceptions.

  • Brand Identity – It entails with customers' opinions towards a good or service of the firm.
  • Brand Meaning – A strong brand name will supports to eradicate misunderstanding or issues of buyers.
  • Brand Response –  People will judge a brand by considering its actual or perceived quality. Thus, it refers with buyers' response for a product or brand.
  • Brand Resonance – Any business association will attain brand resonance as if people have strong or emotional relations with a brand.


P4 How brands are managed collaboratively and in partnership

It is fundamental for every corporate association in order to manage its brand in an imperative manner at national or international level. It results accomplishment of goals and objectives in the best possible manner.

Brand Extension -

Brand Extension is an acquisition of pre-set up brand name or brand mark so as to sell its new product categorises.  The new aura in which a product or brand is going to be expanded is linked with inconsequential with existing classifications. An effective or prestigious brand is able to dispatch other products in new product categorises by using less marketing efforts. Therefore, it can be said that brand equity acts as an imperative marketing strategy of the firm under that a brand name is used to sell products in market, another business or some other entity that is substantially different from the original.

L'Oreal has realised the need for caution in case of brand extensions; the firm takes this decision after conducting an effective research. At the point when L'Oreal first uncovered its L'Oreal Kids cleanser line mid 1998, retailers were wary. "Retailers say the esteem isn't there. We say it is that the youngster builds up esteem. We were quite persevering." - said Carol Hamilton, 45, senior VP-promoting for the L'Oreal retail division of Cosmair. L'Oreal experts motorizes with L'Oreal proficient salons so as to advance their item as well as to enable beauticians to have a dream, to exceed expectations and achieve.

On the other hand, Lakme was another beauty brand to launch its cosmetics which was established in 1952 in order to fulfil the needs of women.  In 1966, the company was no longer a subsidiary of Tata group and they sold their stakes to Hindustan Unilever Limited.  It also has its own salons in major cities and has upcoming projects in tier 2 cities as well. This acts as an added advantage to the company’s profile. It also organises and sponsors the biggest fashion show in India, “The Lakme Fashion Week” where leading designers showcase their designs. It has products in all ranges and of the best quality. Through tremendous endorsements, advertisements and innovations it has a large and loyal customer base.

Line extensions:

When a product is used to brand a new product that targets a new market segment within a product category and existing served by the parent brand. L'Oreal is highly endowed in managing its portfolio at global context as it covers all segments of customers. In addition, the prime product line of L'Oreal is -  hair care, colouring, skin care, make-up and perfume. In which, Consumer Products Division offers the best in cosmetics innovation to the greatest number of people on every continent. Along with this, firm's brand are easily avilable at in markets, hypermarkets, medicines stores, general shops etc.

On the other hand, another famous brand of the company L'Oréal Luxe provides cosmetics for both men and women across the world an array of prestigious and modern international brands with a unique heritage. The brands of L’Oréal Luxe strive to promote the different specialities of luxury beauty: skincare, make-up and fragrances.

Strategies and approaches of brand portfolio management: -


Current Products

New Products

Current Market

Market Penetration

Product Development Strategy

New Market

Market Development Strategy

Diversification strategy

  • Market penetration – Loreal tries to build its entrance of the market with a current item. The objective is to expand its piece of the pie. It is the slightest dangerous system on the grounds that the organization can utilize existing assets, procedures and limits.
  • Market development- this includes hunting down extra market portions or locales. The organization utilizes its current items and on the off chance that it figures out how to deliver them in top notch, this can be a fitting system. It is less secure than the past technique.
  • Product development -  the organization advances the item and tries to apply it to existing markets. This methodology is suitable if the organization is solid in development. The advancement of another item is less secure than past methodologies.
  • Diversification - the least secure choice of every one of the four techniques. L'Oreal tries to enhance a current item or build up another one and prevail with it in another market.

P5 Different types of techniques for measuring and managing brand value

Brand evaluation is one of the most imperative thing which supports to build growth and success of a firm. Brand value can be evaluated through buyers' previous experience  and responses.

Companies measure their brand value for different reasons that are as followed: -

  • Allocation of buying costs
  • Sale of intangibles
  • Indirect security
  • Harm or impairment
  • Economic damages which occurs due to infringement and breach of contract.
  • Accounting reports

Brand valuation evaluates a brand based on the following criteria:

  • Financial Forecast – forecasted earnings
  • The Role of the Brand – the percentage of a company’s earnings attributed to brand
  • Brand Strength – a brand’s risk

Brand equity audit can be done by SWOT analysis: -


  • Strong brand recall for L’Oreal in UK and perceived quality of product is high
  • L'Oreal is serving in 130 nations where is has wide customer base ; it is one the main reason behind improving brand image of the firm.
  • The firm is also active in pharmaceutical field and it is top nano-technology holder.


Having low presence in natural segments.

  • Its main brand Garnier is suffering  with brunt of competition as in hair hair care segment there is tough competition from HUL and P&G products.  
  • High R&D costs is slowing down new product development.


  • The potential market of beauty items or personal care is going to be increased. The world is an oyster and various economies will be developed soon.
  • Higher market share cause of wide range of patents are registered with it.
  • L'Oreal can easily enter into flourishing markets as its has a wide range of affluent and the aging products for developed nations. 


  • Growing competition within field of cosmetic brands.
  • Economic recession that is quite evident in other countries.

Approaches for valuation of brands -

  • Income-based brand evaluation – Value of any can be defined through future cash expected which will generated by itself. Income based brand evaluation is based of future estimations or profits.
  • Cost based brand evaluation – It assists to measure the  value of a brand by using a an estimation of investments which are used in building, replacing or reproducing the brand. Cost based brand evaluation is rely upon certain premises that a prudential investor  would not pay more for a brand rather than its costs which have been taken into replace or regenerate an asset of similar utility.
  • Market based brand evaluation – It evaluates themselves value of a product by taking an estimation of what others purchasers will have paid for same assets or products for those which are being measured. Therefore, the application of a market approach results in an estimate of the price expected to be realized if the brand were to be sold in the open market.


As per the above discussion, it get concluded that brand management is one of the crucial task for every business association as it adds value in products and services of the firm. Today, brands have made a unique image in the corporate world with the assessment of name, logo and unique features into one thing. The report stated that significance of branding, such as- Brand recognition,  builds trust and provide inspiration to employees. Thus to manage its brand, L'Oreal creates different marketing or advertising campaigns so as to attract more and more people.


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